GST payable on the non-retained consider
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Commonwealth legislation
This Act has been repealed and is no longer in force. It is retained for historical reference.
This determination resolves a GST cash‑flow problem in construction contracts with retention clauses by treating the main contract consideration under normal GST timing while applying special timing to the retention amount. A builder isn’t required to attribute GST on withheld retention until an invoice for that retention is issued after the defects period, protecting cash flow while ensuring eventual tax collection.
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Direct links to the current provisions in A New Tax System (Goods and Services Tax) Act 1999 (Particular Attribution Rules for Retention Payments) Determination (No. 1) 2000.
input tax credit on the non-retained consideration, in relation to a creditable acquisition, means the amount worked out in accordance with Clause 6(2);
input tax credit on the retention amount, in relation to a creditable acquisition, means the amount worked out in accordance with Clause 6(1);
invoice for the retention amount, means a document notifying an obligation to pay the retention amount issued in relation to that amount following the expiry of the defects period;
non-retained consideration, in relation to a taxable supply or a creditable acquisition, means the amount obtained by subtracting the retention amount from the consideration for that supply;
retention amount, in relation to a taxable supply or a creditable acquisition, means that part of the consideration for the supply that the recipient of the supply retains under the terms of a contract which provide for the recipient to retain an amount until certain conditions specified in the contract are met;
the Act means the A New Tax System (Goods and Services Tax) Act 1999.
(2) Other expressions in this Determination have the same meaning as in the Act.
Signed this 30th day of June 2000
Signed by Marilyn Knight
Senior Tax Counsel
Goods and Services Tax Program
Delegate of the Commissioner
Sourced from the Federal Register of Legislation (legislation.gov.au), CC BY 4.0.
input tax credit on the non-retained consideration, in relation to a creditable acquisition, means the amount worked out in accordance with Clause 6(2);
input tax credit on the retention amount, in relation to a creditable acquisition, means the amount worked out in accordance with Clause 6(1);
invoice for the retention amount, means a document notifying an obligation to pay the retention amount issued in relation to that amount following the expiry of the defects period;
non-retained consideration, in relation to a taxable supply or a creditable acquisition, means the amount obtained by subtracting the retention amount from the consideration for that supply;
retention amount, in relation to a taxable supply or a creditable acquisition, means that part of the consideration for the supply that the recipient of the supply retains under the terms of a contract which provide for the recipient to retain an amount until certain conditions specified in the contract are met;
the Act means the A New Tax System (Goods and Services Tax) Act 1999.
(2) Other expressions in this Determination have the same meaning as in the Act.
Signed this 30th day of June 2000
Signed by Marilyn Knight
Senior Tax Counsel
Goods and Services Tax Program
Delegate of the Commissioner